Code of Conduct for Intermediaries of Mutual Funds

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..... for Intermediaries of Mutual Funds 1. Please refer to the SEBI circular MFD/CIR/06/210/2002 dated June 26, 2002 on the captioned subject. 2. In order to make the offer document more reader friendly SEBI vide circular SEBI/IMD/CIR No. 5/126096/08 dated May 23, 2008 split the offer document into two parts i.e Statement of Additional Information (SAI) and Scheme Information Document (SID). Fur .....

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..... comply with the code of conduct, the mutual fund shall report it to AMFI and SEBI. No mutual fund shall deal with those intermediaries who do not follow code of conduct. 5. This circular is issued in exercise of powers conferred under Section 11 (1) of the Securities and Exchange Board of India Act, 1992, read with the provisions of Regulation 77 of SEBI (Mutual Funds) Regulations, 1996, to pr .....

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..... sclosures and brochures and recommend schemes appropriate for the client s situation and needs. 4. Highlight risk factors of each scheme, avoid misrepresentation and exaggeration and urge investors to go through SID/ KIM before deciding to make investments. 5. Disclose to the investors all material information including all the commissions (in the form of trail or any other mode) received fo .....

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..... nd/redemption cheques, etc. 9. Avoid commission driven malpractices such as : (a) recommending inappropriate products solely because the intermediary is getting higher commissions therefrom. (b) encouraging over transacting and churning of Mutual Fund investments to earn higher commissions, even if they mean higher transaction costs and tax for investors. 10. Avoid making negative stat .....

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..... g and advisory services ensures correct selling and also reduces the trend towards investors asking for passback of commission. 16. All employees engaged in sales and marketing should obtain AMFI certification. Employees in other functional areas should also be encouraged to obtain the same certification. - Circular - Trade Notice - Public Notice - Instructions - Office orders Tax Managemen .....

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